KKR mulls investing $150 mn in Korean fashion platform Musinsa

The company will raise another $150 mn from a state-run bank and existing stakeholders via a pre-IPO funding round

South Korean fashion platform Musinsa's flagship store in Gangnam, Seoul (Courtesy of Musinsa Newsroom)
South Korean fashion platform Musinsa's flagship store in Gangnam, Seoul (Courtesy of Musinsa Newsroom)
Jong-Kwan Park and Jun-Ho Cha 2
2023-04-25 17:51:45 pjk@hankyung.com
Pre-IPOs

Musinsa Co., South Korea’s leading online fashion platform, is in the final stage of attracting 200 billion won ($149.8 million) from US private equity giant KKR & Co. via a funding round before going public. Valued at 4 trillion won, the company will draw another 200 billion won from other investors, according to sources familiar with the matter on Tuesday.  

KKR is considering the investment via its growth fund, while the fashion platform’s existing shareholders, including Seoul-based IMM Investment Corp., as well as state-back Korea Development Bank will also inject capital, sources said.

Musinsa is set to use the funds to expand its business in global markets including the US, Japan, Singapore and Thailand.

The company was founded as an online community for fashion in 2001 and launched an e-commerce website in 2009. It has garnered young consumers’ attention by introducing smaller brands specializing in street fashion.   

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Musinsa has raised a combined 330 billion investment since its inception. The company attracted about 200 billion won from US-based Sequoia Capital in 2019, and with a 2.5 trillion valuation, it drew an additional 130 billion won from the US venture capital firm and IMM Investment in 2021. 

After the funding round in 2021, Musinsa acquired fashion platform 29CM and its parent StyleShare to boost its competitiveness in women's fashion.

Musinsa’s pre-IPO funding stands out as the local platform operator listing market has frozen in the wake of rate hikes. Some e-commerce platforms, which have focused on transaction volume rather than profit, are in the worst of times.

Kurly Inc., a fresh food delivery platform, kicked off a new funding round earlier this month to raise 100 billion at less than half its peak valuation, at which it raised 250 billion won in 2021. The new fundraising takes place after it canceled an IPO in January of this year amid the subdued stock market.  

Musinsa achieved 708.3 billion won in revenue last year, up 53.5% on-year. Its annual operating profit plunged 94.5% to 3.2 billion won on a consolidated basis, with a net loss of 55.8 billion won from subsidiaries including a reseller platform. On a standalone basis, Musinsa posted an operating profit of 53.9 billion won in 2022.

Write to Jong-Kwan Park and Jun-Ho Cha at pjk@hankyung.com

Jihyun Kim edited this article.
#Musinsa Korea #Korean fashion platform #Korean e-commerce #Korea Musinsa fashion #Musinsa KKR #Musinsa pre-IPO #Korean IPO market

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